by Liquefied natural gas (LNG) refers to natural gas that has been cooled to liquid form for ease and safety of non-pressurized storage or transport. The primary use of LNG is as a fuel and feedstock. As a fuel, it is used primarily for electricity generation and to power heavy vehicles and marine vessels. It is also used as feedstock in various industrial applications including petrochemical production. LNG provides advantages over pipeline natural gas such as facilitating gas transmission over long distances through ocean tankers and safer storage in tightly sealed tanks.
The Liquefied Natural Gas Market is estimated to be valued at US$ 8.8 Bn or Mn in 2023 and is expected to exhibit a CAGR of 9.0% over the forecast period 2023 to 2030, as highlighted in a new report published by Coherent Market Insights.
Market Dynamics:
The growing demand for cleaner sources of energy is a key driver for the liquefied natural gas market. Natural gas produces less carbon emissions as compared to coal and oil when combusted, making it an attractive transitional fuel for countries and industries aiming to reduce their carbon footprint. Furthermore, with the increasing global energy demand coupled with depleting oil and gas reserves, countries are increasingly relying on LNG imports to meet their growing energy needs. For instance, East Asian countries such as China, Japan and South Korea are major importers of LNG primarily used for power generation and city gas distribution. The increasing government support for the development of LNG infrastructure such as liquefaction and regasification terminals is also expected to boost market growth over the forecast period. However, rising competition from renewable energy coupled with technical challenges associated with LNG transportation and projects delays may hamper market growth.
Segment Analysis
The liquefied natural gas (LNG) market is segmented into extraction & liquefaction and transportation & regasification. The extraction & liquefaction segment currently dominates the market owing to increase in demand for LNG across industries and regions. The segment deals with extracting natural gas from gas wells and liquefying it by cooling it to -162°C, which reduces its volume by about 600 times, making it economical for transportation over long distances by ships.
PEST Analysis
- Political: Governments across regions are supporting expansion of LNG infrastructure via favorable policies and investments to promote use of cleaner fuel and increase energy security.
- Economic: Growth in trade volumes between major LNG producing and consuming countries is boosting market revenues.
- Social: Use of LNG in power generation, transport, and other sectors is increasing due to its lower emissions and prices compared to coal and petrol.
- Technological: Development of more efficient liquefaction technologies is helping reduce environmental impact and extraction costs.
Key Takeaways
The global Liquefied Natural Gas Market is expected to witness high growth, exhibiting CAGR of 9.0% over the forecast period 2023 to 2030, due to increasing demand for cleaner energy and focus on reducing carbon emissions. The market size for LNG is estimated to reach US$ 8.8 Bn in 2023.
Regional analysis- Asia Pacific region holds the largest share of the global LNG market and is estimated to remain the fastest growing market over the forecast period. This is attributed to rising energy demand led by rapid urbanization and industrialization in countries such as China and India.
Key players operating in the LNG market are Asahi Kasei Corporation, Ascend Performance Materials, BASF SE, Invista, Lanxess Ag, PetroChina Liaoyang Petrochemical, Radici Group, Rhodia, Shandong Haili Chemical Industry Company Ltd., and Shandong Hongye Chemical Company, Ltd. Key players are focusing on capacity expansion plans and partnerships with regional utilities to leverage potential growth opportunities.
*Note:
1. Source: Coherent Market Insights, Public sources, Desk research
2. We have leveraged AI tools to mine information and compile it
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